How to Open a Minor Mutual Fund Folio

The exact onboarding process varies by AMC and platform, but the broad process is straightforward.

Step 1: Identify the Guardian

The guardian may generally be a natural parent or a court-appointed legal guardian under the applicable framework. SEBI's mutual fund framework requires the minor to be the first and sole holder, with the guardian acting on the minor's behalf.

Step 2: Prepare the Documents

Depending on the AMC and KYC requirements, documents may include:

• minor's date-of-birth proof

• minor's PAN, where required

• guardian's PAN

• guardian KYC

• proof of relationship

• bank account details

• guardian documentation where applicable

The exact document list should be verified with the AMC before submission.

Step 3: Open the Folio in the Minor's Name

The minor is the investor/first and sole holder. The parent or legal guardian is recorded in the guardian capacity.

Step 4: Select the Investment

Parents should select the investment according to:

• goal

• time horizon

• risk

• liquidity needs

• diversification

• costs

Step 5: Set Up Contributions

A SIP can then be established if permitted by the selected scheme and platform.

SEBI's framework allows payments for minor mutual fund investments from the minor's bank account, the parent's/legal guardian's account, or a joint account of the minor with the parent/legal guardian, subject to the applicable requirements. Redemption proceeds are required to be credited to the verified bank account of the minor.

Step 6: Review, Don't Constantly Trade

An annual review is generally more useful than reacting to every market movement.

The portfolio should be checked against the original goal and time horizon.